Letters: Farm loan waiver

Former Reserve Bank of India (RBI) Governor Y V Reddy was a tough man who tried to wield institutional autonomy in the larger interest of India’s economy. He did not mince words in expressing his views and often had to face the displeasure of the government. He was, like any other RBI governors, not for farm loan waivers. But some reviews of his new book, Advice & Dissent, suggest a mellowed personality.
 
He says although farm loan waiver isn’t a good thing it is not a disaster. He can’t be wrong. The total outstanding in agriculture loan was around Rs 12.40 lakh crore, 12.1 per cent of the outstanding bank credit, as on September 30, 2016. While 70 per cent of the total stressed debts of Rs 600,000 crore, as of March 2016, are of corporates, one per cent accounts for the farm sector. As many as 1.36 crore farmers in Maharashtra have an outstanding loan of Rs 1.14 crore. The farmers, by and large, have been driven to commit suicide (no corporate borrower is constrained to commit suicide) as they were or are not in a position to repay debts mainly because of loss of crop on account of the vagaries of nature, coupled with non-remunerative prices on their produce received from middlemen and/or from successive governments. Ramanath Nakhate   Mumbai

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